WINDHOEK, June ​17 (Reuters) - Namibia's central ⁠bank raised its main interest rate for the ‌first time in three years on Wednesday and revised its ​inflation forecasts upwards because of higher oil prices.

The Bank of ​Namibia raised ​its repo rate by 25 basis points to 6.75%.

"The Monetary Policy Committee noted rising global and domestic ⁠inflationary pressures over the near term, despite the ensuing peace agreement between the United States and Iran," the central bank said in a statement.

It said ​a ‌moderate tightening of ⁠policy was ⁠warranted given subdued domestic economic activity and sluggish credit extension.

Inflation quickened ​to 4.1% year on year ‌in May from 3.1% in April.

The uptick came despite the Southern African country's government cutting fuel levies to cushion the impact of the global energy price surge triggered by the U.S.-Israeli war against Iran.

The central bank now expects inflation to average 4.0% in 2026, higher than the 3.7% forecast given at its April policy meeting.

Namibia's monetary policy is typically closely aligned with that ⁠of neighbouring South Africa and ​its currency pegged one-to-one with the rand.

The South African Reserve Bank also raised its main lending rate by ​25 basis ‌points last month.